Appraisal Report Multi-Family Walkup Property North Battleford Apartments 1101, 1121 109 St North Battleford, Saskatchewan
PREPARED FOR: Kenneth Engler
102109845 Saskatchewan Ltd. 1901, 1088 - 6th Ave SW Calgary, AB T2P 5N3 PREPARED BY: Valta Property Valuations Ltd. 300, 4838 Richard Road SW Calgary, AB T3E 6L1 Office: 587-801-5151 www.valta.ca Date of Valuation: October 17, 2025 Date of Report: November 20, 2025 File No: VAL251012 - 1 | |
November 20, 2025
102109845 Saskatchewan Ltd.
1901, 1088 - 6th Ave SW,
Calgary, AB T2P 5N3
Attention: Kenneth Engler,
Re: As Stabilized (Fee Simple Estate) current market value for the property located at 1101, 1121 109 St, North Battleford, SK.
Valta Property Valuations Ltd. is proud to present the appraisal report that satisfies the agreed upon scope of work with 102109845 Saskatchewan Ltd. The purpose of this assignment is to provide the As Stabilized current market value of the property which at the time of inspection represents the improved property as of the effective date and leased up at market rental rates and operating costs for the property located at 1101, 1121 109 St, North Battleford, SK (herein referred to as the ‘subject property’).
The subject property, located at 1101, 1121 109 St, North Battleford, SK, is a multi-family, walkup property with improvements located in North Battleford The improvements are comprised of 2 total buildings, and consist of 10,204 square feet of net rentable area (NRA) as of the valuation date. The property, reportedly built in 1970; (1970 weighted) is approximately 100.0% occupied and features 16 units in a 2-story, garden style format.
Based upon our investigation of the real estate market and after considering all of the pertinent facts as set forth in the body of this appraisal report, as of the effective date, we have concluded the following:
The use of a hypothetical condition(s) may have impacted the results of the assignment. The As Stabilized value has been developed based on the hypothetical condition that the subject property is fully leased at prevailing market rents and has achieved stabilized occupancy as of the effective date of the appraisal. Under this premise, no deductions are made for holding costs, rent loss, or lease-up expenses. In addition it is a hypothetical condition that all units could achieve current market rent levels and stabilized occupancy as of the effective date. In reality, as of the effective date, the property's existing lease terms reflect contract rents that are deemed to be below-market rents. For the purposes of this analysis, it is assumed that lease-up to market rent levels has occurred under typical market conditions, without undue delay or concessions exceeding market norms. If this assumption proves incorrect, such as market rents are not achievable the value conclusion may be materially impacted.
Extraordinary Assumptions
No Extraordinary Assumptions were made for this assignment.
Extraordinary Limiting Conditions
No Extraordinary Limiting Conditions were made for this assignment.
The report has been completed in accordance with the Canadian Uniform Standards of Professional Appraisal Practice (“CUSPAP”) adopted January 1, 2024. The full narrative appraisal report that follows sets forth the pertinent data and analyses leading to the conclusions presented herein. The appraisal requirements section of this report sets out the basis of the appraisal, definitions and the valuation methodology and must be read to gain a full understanding of the process.
If there are any specific questions or concerns regarding the attached appraisal report, or if Valta can be of additional assistance, please contact the individuals listed below.
Respectfully Submitted,
VALTA PROPERTY VALUATIONS LTD.
Chris Chornohos, AACI, MRICS | |
Founder | |
chris.chornohos@valta.ca | |
AIC No: 902097 |
Introduction & Executive Summary 1
Identification of Assignment 12
Property Taxes & Assessment 23
Description of the Improvements 26
Multi-Family Market Overview 31
Direct Comparison Approach: Multifamily 50
Contingent & Limiting Conditions 65
Qualifications of the Appraiser 72
Introduction & Executive Summary
Hypothetical Conditions
The use of a hypothetical condition(s) may have impacted the results of the assignment. The As Stabilized value has been developed based on the hypothetical condition that the subject property is fully leased at prevailing market rents and has achieved stabilized occupancy as of the effective date of the appraisal. Under this premise, no deductions are made for holding costs, rent loss, or lease-up expenses. In addition it is a hypothetical condition that all units could achieve current market rent levels and stabilized occupancy as of the effective date. In reality, as of the effective date, the property's existing lease terms reflect contract rents that are deemed to be below-market rents. For the purposes of this analysis, it is assumed that lease-up to market rent levels has occurred under typical market conditions, without undue delay or concessions exceeding market norms. If this assumption proves incorrect, such as market rents are not achievable the value conclusion may be materially impacted.
Extraordinary Assumptions
No Extraordinary Assumptions were made for this assignment.
Extraordinary Limiting Conditions
No Extraordinary Limiting Conditions were made for this assignment.
1101 - East Elevation | 1101 - West Elevation |
Street View Facing East - 11 Ave | Street View Facing North - 109 St |
1101 - Typical Hallwall | 1101 - Typical Stairway |
1101 - Typical Bathroom | 1101 - Typical Bedroom 1 |
1101 - Typical Bedroom 2 | 1101 - Electrical Room |
1101 - Mechanical Room | 1101 - Typical Kitchen |
1101 - Living Room | 1121 - West Elevation |
1121 - East Elevation | 1121 - Typical Hallway |
1121 - Typical Stairway | 1121 - Typical Living Room |
1121 - Typical Bathroom | 1121 - Typical Kitchen |
1121 - Typical Bedroom | 1121 - Laundry Room |
1121 - Electrical Room | 1121 - Typical Boiler |
1121 - Utility Room |
The subject property, located at 1101, 1121 109 St, North Battleford, SK, is a multi-family, walkup property with improvements located in North Battleford
The improvements are comprised of 2 total buildings, and consist of 10,204 square feet of net rentable area (NRA) as of the valuation date. The property, reportedly built in 1970; (1970 weighted) is approximately 100.0% occupied and features 16 units in a 2-story, garden style format.
Legal Description
Plan - C4240; Block - 95; Lot - 17,18, 19, 20
Authorized Client Identification
The authorized client of this specific assignment is 102109845 Saskatchewan Ltd..
Authorized Use & Authorized Users
The authorized use of this report is for first mortgage financing purposes. 102109845 Saskatchewan Ltd. is the only authorized user of this report.
Effective Date of Value and Report Date
The effective date of value of this appraisal is October 17, 2025. The report date is November 20, 2025.
October 17, 2025
The purpose of this assignment is to provide the As Stabilized which at the time of inspection represents the existing improvements assuming stabilized occupancy as of the effective date for the property located at 1101, 1121 109 St, North Battleford, SK (herein referred to as the ‘subject property’).
The use of a hypothetical condition(s) may have impacted the results of the assignment. The As Stabilized value has been developed based on the hypothetical condition that the subject property is fully leased at prevailing market rents and has achieved stabilized occupancy as of the effective date of the appraisal. Under this premise, no deductions are made for holding costs, rent loss, or lease-up expenses. In addition it is a hypothetical condition that all units could achieve current market rent levels and stabilized occupancy as of the effective date. In reality, as of the effective date, the property's existing lease terms reflect contract rents that are deemed to be below-market rents. For the purposes of this analysis, it is assumed that lease-up to market rent levels has occurred under typical market conditions, without undue delay or concessions exceeding market norms. If this assumption proves incorrect, such as market rents are not achievable the value conclusion may be materially impacted.
Extraordinary Assumptions
No Extraordinary Assumptions were made for this assignment.
Extraordinary Limiting Conditions
No Extraordinary Limiting Conditions were made for this assignment.
The subject property is currently under the ownership of 102109845 Saskatchewan Ltd.
Three-Year Sales History
Ownership of the subject property has not changed in the past three years. We are unaware of any pending sales or listing activity relating to the subject property.
Exposure & Marketing Time
An estimate of market value is related to the concept of reasonable exposure time. Exposure time is the property's estimated marketing time prior to a hypothetical sale at market value on the effective date of the appraisal. It is a retrospective function of asking price, property type, and past market conditions and encompasses not only adequate, sufficient and reasonable time but also adequate, sufficient and reasonable effort. Reasonable exposure time is a necessary element of a market value definition but is not a prediction of a specific date of sale.
In appraisal theory and practice, there is a distinction relating to the perspective between exposure time and marketing time. Exposure time is presumed to precede the effective date of appraisal whereas marketing time is presumed to succeed the effective date. Marketing time is a prospective function of asking price, property type, and anticipated market conditions. The exposure period assumes the following:
A marketing time estimate is a forecast of a future occurrence. History should be considered as a guide, but anticipation of future events and market circumstances should be the prime determinant.
Noting the subject property’s physical, legal, economic and market characteristics, which are described further in this report, we have concluded a reasonable estimate of exposure and marketing time for the subject property to be six months.
Definition of Market Value
According to the January 1, 2024 version of the Canadian Uniform Standards of Professional Appraisal Practice (CUSPAP), market value is defined as:
“The most probable price, as of a specified date, in cash, or in terms equivalent to cash, or in other precisely revealed terms, for which the specified property rights should sell after reasonable exposure in a competitive market under all conditions requisite to a fair sale, with the buyer and the seller each acting prudently, knowledgeably, and for self-interest, and assuming that neither is under undue duress.”
Implicit in this definition are the consummation of a sale as of the specified date and the passing of title from seller to buyer under conditions whereby:
The property rights appraised constitute the fee simple estate interest.
Absolute ownership unencumbered by any other interest or estate, subject only to the limitations imposed by the governmental powers of taxation, eminent domain, police power and escheat. The subject multifamily property is appraised under the fee simple interest, as residential tenancies are typically short-term in nature and do not constitute long-term encumbrances on the estate that would give rise to a leased fee interest.
Value Scenarios
Current Value
Current Value Opinion refers to an effective date at the time of inspection or, at some other date within a reasonably short period of time from the date of inspection when market conditions have not or are not expected to have changed.
Scope of Work
The scope of work for this appraisal assignment is outlined below:
The following work was not undertaken as it was not required for credible results within the scope of this concise assignment in conformity with CUSPAP 2024.
This appraisal was completed in conformity with the CUSPAP 2024 Appraisal Standard and the Reporting Standard for a Concise Report, which requires inclusion of all relevant information necessary to produce a credible result, summarized in narrative form with supporting detail in the work file.
Paul Liboiron of Insight Home Inspections Ltd., a member of Alberta Professional Home Inspectors Society provided real property appraisal assistance to the appraisers signing this certification. Assistance provided includes property inspection. Paul Liboiron is registered as a non-member with the AIC to provide professional assistance with real property inspection.
The following sources were contacted to obtain relevant information:
The lack of the unavailable items could affect the results of this analysis. As part of the general assumptions and limiting conditions, the subject is assumed to have no adverse easements, significant items of deferred maintenance, or be impacted by adverse environmental conditions.
Personal Property & Business Intangible
There is no personal property (FF&E) included in this valuation. There is not any business or intangible value included in the value conclusion reported herein.
The subject property is located in North Battleford, Saskatchewan, in a centrally situated residential area near key commercial corridors and the downtown core.
Access
The property fronts 109 Street with convenient connections to major arterials including 100th Street/Highway 4 (north–south route to downtown and Highway 16) and Territorial Drive (east–west/loop connecting retail and services).
Public Transportation
Local bus service operates on nearby corridors such as 100th Street and Territorial Drive, providing direct access to downtown, retail centres, and community facilities.
Walk/Bike/Transit Scores
The immediate area offers moderate walkability and cycling potential, with an estimated Walk Score around 60, Transit Score near 35, and Bike Score around 55, reflecting car-optional access for daily needs.
Local Area
The neighbourhood is a mature urban district with a mix of single-family homes, small multi-unit buildings, and local businesses. Residents are close to grocery, cafés, and parks, with recreation and services clustered along 100th Street and Territorial Drive. The location balances neighbourhood livability with quick access to city amenities and employment nodes.
Nearby Schools
• Bready School (K–7, public)
• Connaught School (K–7, public)
• North Battleford Comprehensive High School (Grades 10–12, public)
• John Paul II Collegiate (Grades 9–12, Catholic)
• St. Mary School (K–7, Catholic)
The subject property consists of one parcel with a total site area of 24,400 SF (0.56 AC) which is based on information obtained from ICS. For the purposes of this report, we have relied on this site area and reserve the right to amend our analysis upon receipt of a formal legal plan. The following summarizes the salient characteristics of the subject site.
Address 1101, 1121 109 St, North Battleford, Saskatchewan
Adjacent Properties
North Residential
South Residential
East Residential
West Residential
Accessibility Access to the subject site is considered average overall.
Exposure & Visibility
Exposure of the subject is average noting frontage on 109 Street & 11 Avenue
Easements
A legal opinion regarding title information was not provided or commissioned in conjunction with this assignment. Under the scope of this appraisal, it is assumed that any legal notations and registered charges on title do not adversely affect the highest and best use of the subject property as described herein, unless otherwise noted. If there is any concern on the part of the reader with respect to the status of title, we recommend a legal opinion be obtained. A copy of the subject property title has been inserted in the appendix to this report if further information is required.
Soils
We have not undertaken a detailed soil analysis and we are not qualified to comment on soil conditions. As such, the soils are assumed to be similar to other lands in the area and suitable in drainage qualities and load bearing capacity to support the existing development.
Hazardous Waste
Based on a review of an independent investigation to determine the presence or absence of toxins on the subject property, none are present. If questions arise, the reader is strongly cautioned to seek qualified professional assistance in this matter. Please see the Assumptions and Limiting Conditions for a full disclaimer.
Site Rating
Overall, the subject site is considered average as a multi-family site in terms of its location, exposure and access to employment, education and shopping centers, based on its location along a minor arterial.
Site Conclusion
In conclusion, the site’s physical characteristics appear to be supportive of the subject’s current use and there were no significant detriments discovered that would inhibit development in accordance with its highest and best use.
Site Plans – Lot 17
Site Plans – Lot 18
The subject’s assessment and taxes are shown in the following table:
Taxation & Assessment Commentary
The assessed value is below the value concluded herein, a tax assessment appeal is not warranted.
The assessed value is lower than our valuation herein. Smaller markets tend to under assess real property assets in comparison to larger markets.
The subject is located in the Low Density Residential District (R2) zoning area which is a Low Density Residential District.
Zoning Conclusion
The current use for the subject property is walkup and is a permitted use based on the current zoning guidelines. No zoning change is believed to be imminent. Based on the foregoing, it appears that the subject’s improvements are a legally conforming use of the subject site.
Zoning Map
Description of the Improvements
The information presented below is a basic description of the existing improvements that are used in the valuation of the property. Reliance is placed on information provided by sources deemed dependable for this analysis. It is assumed that there are no hidden defects, and that all structural components are functional and operational, unless otherwise noted. If questions arise regarding the integrity of the improvements or their operational components, it may be necessary to consult additional professional resources. The sizes are based on the information provided by the client and from public sources.
Overview
The subject property, located at 1101, 1121 109 St, North Battleford, SK, is a multi-family, walkup property with improvements located in North Battleford
The improvements are comprised of 2 total buildings, and consist of 10,204 square feet of net rentable area (NRA) as of the valuation date. The property, reportedly built in 1970; (1970 weighted) is approximately 100.0% occupied and features 16 units in a 2-story, garden style format.
Building Description
COMPONENT | DESCRIPTION |
Project Amenities | Guest Parking |
Unit Amenities | Deck/Patio, Range/Stove, Refrigerator |
Laundry | On Site |
Security Features | Deadbolts, Exterior Lighting, Secured Entry |
Foundation | Concrete footings and walls; |
Exterior Walls/Framing | 1121 - Brick, 1101 Stucco/Wood frame; |
Roof | Flat built up membrane; |
Elevator | None; |
Heating & AC (HVAC) | 1101 - 8 Furnaces, 1121 - Boilers with baseboard radiant heat; |
Insulation | Fiberglass; |
Lighting | Various; |
Electrical | Individually metered; |
Interior Walls | Painted drywall; |
Doors and Windows | Wood interior & metal exterior doors/Vinyl or metal frame double pane glazing; |
Ceilings | Textured drywall; |
Plumbing | Standard; |
Floor Covering | Combination of carpet, tile, vinyl tile and laminate hard wood; |
Fire Protection | None; |
Interior Finish/Build-Out | Standard rental finishes; |
Site Improvements | Gravel parking, sidewalks, and curbs; |
Landscaping | Landscaping around the building perimeter to consist of shrubs and trees. The landscaping as proposed is well established and well maintained. |
Parking | The subject provides 18 parking spaces and is therefore conforming to zoning requirements. The parking ratio of 1.1 per unit is within the typical range of spaces per unit and within zoning requirements. |
Site Coverage Ratio | 12.9% (3,138 SF footprint / 24,400 SF site), which is within market standards (20-35%) for similar walkup buildings in the area. |
Functional Design | The building features a functional Walkup design with typical site coverage and adequate off-street parking. |
Hazardous Materials | A Phase I report was not provided. This appraisal assumes that the improvements are constructed free of all hazardous waste and toxic materials, including (but not limited to) unseen asbestos and mold. Please refer to the Assumptions and Limiting Conditions section regarding this issue. |
National
Canada’s economy in 2025 finds itself in a delicate balance: modest growth, contained inflation, but significant uncertainty from external trade and global energy markets. The Bank of Canada expects real GDP growth to recover toward 1.8% in 2025–2026, after a softer 2024. Inflation is projected to remain close to the 2% target, aided by moderating rent inflation and easing supply pressures. On the positive side, residential investment and housing construction are expected to lead growth, supported by past rate cuts, pent-up demand, and government incentives for rental construction. Meanwhile, energy and export infrastructure especially pipeline capacity and LNG projects could provide a lift to Canadian exports. However, the risk of U.S. tariffs and a weakening labour market looms as a drag. In sum, Canada’s 2025 is expected to be a moderating year, with growth stabilizing, inflation under control, and selective pockets of strength in housing, energy, and exports. The upside hinges on trade resolution and external demand; the downside centers on global turmoil, policy missteps, or weakening domestic demand.
Provincial
Saskatchewan
Saskatchewan’s economy in 2025 is defined by steady growth, strong resource activity, and an improving housing sector. Real GDP is expanding at a moderate pace, supported by agriculture, potash, and oil production, while inflation has cooled to below 2%, easing cost pressures on households. Employment conditions remain relatively solid, with unemployment near 5.5–6%, and consumer demand is buoyed by wage gains and population growth. Housing starts have surged, reflecting confidence in residential markets and rising construction momentum. On the investment front, resource projects and infrastructure spending provide additional stability, and the province maintains a solid AA credit rating with a balanced budget outlook. Risks remain tied to commodity markets, especially oil prices and global agricultural demand, along with challenges in attracting and retaining skilled labour. In sum, Saskatchewan’s 2025 outlook is stable and resource-anchored, with healthy construction activity and moderate inflation, but still exposed to the swings of global markets.
Multi-Family Market Overview
Saskatchewan
Saskatchewan’s rental markets entered 2025 with improving balance. Vacancy rates approached 3 %, reflecting steady new completions and a cooling inflow of migrants. Rents plateaued after outsized 2023–24 gains, with most urban landlords holding rates or offering small concessions. Construction activity remains healthy, supported by government and CMHC financing programs. Affordability remains better than the national average, yet rising rent-to-income ratios signal growing strain among lower-income tenants.
The highest and best use of a property is defined as the legally permissible, physically possible, financially feasible, and maximally productive use that results in the highest value. This analysis serves as the foundation for the valuation process and determines the most reasonable and profitable use of the property to support its maximum present value.
The analysis is completed through the following four steps:
This structured approach ensures a comprehensive evaluation of the property, moving from a broad market perspective to a focused determination of its optimal use.
This section develops the highest and best use of the subject property As Though Vacant and As Improved.
As Though Vacant Analysis
In this section the highest and best use of the subject as though vacant is concluded after taking into consideration financial feasibility, maximal productivity, marketability, legal, and physical factors.
Legally Permissible
Private restrictions, zoning, building codes, historic district controls, and environmental regulations are considered, if applicable to the subject site. The legal factors influencing the highest and best use of the subject site are primarily government regulations such as zoning ordinances. Permitted uses of the subject’s Low Density Residential District (R2) zoning include low and medium density residential. A zoning change is not likely; therefore, uses outside of those permitted by the R2 zoning are not considered moving forward in the as though vacant analysis.
Physically Possible
The test of what is physically possible for the subject site considers physical and locational characteristics that influence its highest and best use. In terms of physical features, the subject site totals 0.5601-acres (24,400 SF), it is rectangular in shape and has a level topography. The site has average exposure and average overall access. There are no physical limitations that would prohibit development of any of the by-right uses on the site.
Financial Feasibility
Based on the analysis of the subject’s market and an examination of costs and investment metrics and real estate market attributes, a multifamily building would likely have a value commensurate with its costs and requisite developer’s profit.
Maximum Productivity
There is only one use that creates value and at the same time conforms to the requirements of the first three tests. Financial feasibility, maximal productivity, marketability, legal, and physical factors have been considered and the highest and best use of the subject site as though vacant and is concluded to be a multifamily use.
As Improved Analysis
The legal factors influencing the highest and best use of the subject property are primarily governmental regulations such as zoning and building codes. The subject’s improvements were constructed in 1970; (1970 weighted) and are a legal, conforming use. The physical and locational characteristics of the subject improvements have been previously discussed in this report. The project is of average quality construction and average condition, with adequate site coverage and parking ratios.
The five possible alternative treatments of the property are redevelopment/demolition (not warranted as the improvements contribute substantial value to the site), expansion (not applicable, no excess or surplus land), renovation (not warranted), conversion (not warranted), and continued use "as-is" use. Given the underlying market conditions and activity, it appears that the multifamily use As Improved has a sufficient degree of financial feasibility.
Among the five alternative uses, a continuation of the multifamily use is the Highest and Best Use of the subject is As Improved.
Most Probable Buyer
Based on the type of property and the income generating potential of the improvements, it is our opinion that the most probable buyer for the subject would be a local or regional investor As Improved,
In traditional valuation theory, the three approaches to estimating the value of an asset are the cost approach, sales comparison approach, and income capitalization approach. Each approach assumes valuation of the property at the property’s highest and best use. From the indications of these analyses, an opinion of value is reached based upon expert judgment within the outline of the appraisal process.
Land Valuation
Characteristics specific to the subject property do not warrant that a site value is developed.
Cost Approach
The cost approach considers the cost to replace the proposed improvements, less accrued depreciation, plus the market value of the land. The cost approach is based on the understanding that market participants relate value to cost. The value of the property is derived by adding the estimated value of the land to the current cost of constructing a reproduction or replacement for the improvements and then subtracting the amount of depreciation in the structure from all causes. Profit for coordination by the entrepreneur is included in the value indication. Considering the limited applicability of this approach in relation to the subject property's characteristics, we have not undertaken the Cost Approach. The Cost Approach has limited applicability due to the age of the improvements and lack of market based data to support an estimate of accrued depreciation. Based on the preceding information, the Cost Approach has not been undertaken as part of this analysis.
Investors typically do not place emphasis on replacement cost in establishing value for investment properties. The exclusion of the Cost Approach does not diminish the credibility of the value conclusion.
Sales Comparison Approach
The sales comparison approach estimates value based on what other purchasers and sellers in the market have agreed to as price for comparable properties. This approach is based upon the principle of substitution, which states that the limits of prices, rents, and rates tend to be set by the prevailing prices, rents, and rates of equally desirable substitutes. In conducting the sales comparison approach, we gather data on reasonably substitutable properties and make adjustments for transactional and property characteristics. The resulting adjusted prices lead to an estimate of the price one might expect to realize upon sale of the property.
We have undertaken the Direct Comparison Approach as part of this assignment. Considering the applicability of this approach in relation to the subject property's characteristics, we consider the application of this approach to be warranted.
Income Capitalization Approach
The income capitalization approach (“income approach”) simulates the reasoning of an investor who views the cash flows that would result from the anticipated revenue and expense on a property throughout its lifetime. The net income developed in our analysis is the balance of potential income remaining after vacancy and collection loss, and operating expenses. This net income is then capitalized at an appropriate rate to derive an estimate of value or discounted by an appropriate yield rate over a typical projection period in a discounted cash flow analysis. Thus, two key steps are involved: (1) estimating the net income applicable to the subject and (2) choosing appropriate capitalization rates and discount rates. The appropriate rates are ones that will provide both a return on the investment and a return of the investment over the life of the particular property.
We have undertaken the Income Approach as part of this assignment. The subject property comprises an income generating asset and as such, we consider the inclusion of this approach warranted. In undertaking this approach, we have relied on the Direct Capitalization method only as the Discounted Cash Flow method does not contribute substantially to estimating the market value of the subject property beyond the Direct Capitalization method.
upon scope with the authorized client, the subject’s specific characteristics and the interest appraised, this appraisal developed Direct Comparison and Income (Direct Capitalization) Approaches. The values presented represent the As Stabilized (Fee Simple Estate). This appraisal does not develop the Cost Approach, the impact of which is addressed in the reconciliation section.
The Income Approach is based on the premise that properties are purchased for their income producing potential. It considers both the annual return on the invested capital and the return of the invested capital. The two fundamental methods of this valuation technique include Discounted Cash Flow and Direct Capitalization. The Direct Capitalization method of the Income Approach is used in this analysis. This valuation technique best represents the decision-making process of an investor.
The first step in direct capitalization is to estimate the durable rental income through analysis of the in-place or projected (proposed developments) leases and market rent terms. Next, reimbursements and other revenue are analyzed. Then, vacancy and operating expenses are estimated. Finally, the net operating income is capitalized at a supported rate. The implied value may be adjusted to account for non-stabilized conditions or required capital expenditures to reflect an as-is value.
Multi-Family Revenue Analysis
Multi-Family Subject Rent Roll
The following table summarizes the subjects in place unit mix and rental rates.
The majority of the subject tenant leases are on 12-month leases. In addition, security deposit fees for the property equal one month’s rent. The landlord pays for all utilities except electricity.
Multi-Family Market Rent Survey Analysis
This section examines comparable properties within the marketplace to estimate market rent for the subject. This allows for a comparison of the subject property’s contract to what is attainable in the current market.
The analysis is conducted on a dollar per square foot, per month basis, reflecting market behavior. The total dollar per month per unit is also considered.
Selection of Comparables
A complete search of the area was conducted to find the most comparable properties in terms of location, tenancy, age, exposure, quality, and condition. The comparables in this analysis are the most reliable indicators of market rent for the subject available at the time of this appraisal.
Concessions
Currently landlords are not offering concessions.
The following summarizes the comparables most similar to the subject property. The Survey Comparison Table, location map, photographs, and an analysis of the rent survey are presented on the following pages.
Conclusion Of Market Rent - Multi-Family
The following table summarizes the various indicators of market rent for each unit type and provides the market rent analysis and the conclusions for the subject property.
Unit Rent Discussion
The subject property, North Battleford Apartments at 1101, 1121 109 Street, is a 16-unit building of average quality and condition with heat and water included, surface parking, and on-site laundry.
A survey of five comparable buildings in North Battleford and Prince Albert shows 1-bedroom market rents ranging from $1,110–$1,575/month ($1.71–$2.42/SF). Most comparables include heat and water, with upgraded interiors and similar amenities.
Based on the comparables, the subject’s estimated market rent is:
1 Bed / 1 Bath: $1,050/month ($1.62/SF)
This level is slightly below market averages, reflecting the property’s modest finishes and smaller scale, but it remains competitive within the local rental market.
Based on the previous conclusions, the subject’s average contract rent is 99.5% of market rents.
Total Rental Revenue - Multi-Family
The Total Rental Revenue for the Multi-Family component is summarized in the table below. The subject’s average contract rent is 99.5% of market rents. Market rents are applied in our analysis.
The following table summarizes the miscellaneous revenue projected for the subject property.
Potential Gross Revenue (PGR)
The potential gross revenue equals the total rental revenue plus reimbursement and miscellaneous revenue. The potential gross revenue of the subject is calculated by multiplying the sum of market rent of $12,765/Unit and $20.02 per square foot rent and reimbursements, if any, at $0 which is $0/Unit and -/SF by the net rentable area of 10,204 square feet, which indicates a PGR of $204,240.
Vacancy Allowance
This category accounts for the time period between occupants, as well as possible prolonged vacancies under slow market conditions. Market participants typically expect a vacancy of 2% to 5% of potential gross income for similar property types. This assignment reflects the probable vacancy during the economic life of the property and not necessarily the current or short-term vacancy. The findings of the Multi-Family Market Overview section support a typical vacancy allocation. As of the effective date, the subject is 100.0% occupied. Based on current and perceived long-term market conditions and the subject's anticipated tenancy over a typical holding period, a vacancy allowance of 3.8% is concluded.
Effective Gross Revenue (EGR)
Effective gross revenue equals the potential gross revenue less vacancy. The total effective gross revenue for the subject is $196,406 which is $12,275/Unit and $19.25/SF.
We have reviewed the owner’s historical operating expenses. As appropriate, the owner’s operating expenses are reclassified into standard categories and exclude items that do not reflect normal operating expenses for this type of property.
The reclassification is done for proper analysis against comparable data and industry benchmarks as appropriate. The subject’s historical operating expenses with our projections are shown in the following chart.
Expense Conclusions
The individual expense conclusions for the subject are summarized below.
Net Operating Income (NOI)
The net operating income equals the effective gross income less the total expenses. The total net operating income for the subject is $111,771 which is $6,986/Unit and $10.95/SF.
To determine the appropriate capitalization rate for the subject property, consideration is given to:
Alternative Investment Rates
The capitalization rate selected to value the subject property is expected to be higher than the current yield of approximately 3.2% on 10-year Government of Canada bonds. A risk premium of 75–300 basis points is typically applied to commercial and multifamily real estate, resulting in an implied capitalization rate in the range of 4.25%–6.25%. This spread reflects the illiquidity of real estate, management burden and overall (leasing, micro and macro market, physical, financing and regulatory) risk associated with real estate ownership compared to the risk free rate of government securities.
Investment Activity and Trends
The Multifamily Investment Indicator graph below highlights how multifamily yields track interest rate cycles. From 2015 to 2021, cap rates compressed into the mid-4% range as bond yields fell, with investors accepting narrower spreads in exchange for stable rental cash flows. Since 2022, rising bond yields have pushed cap rates back above 5.0%, restoring a healthier premium over government securities. Forecasts suggest modest re-compression as borrowing costs stabilize and spreads compress, though cap rates are expected to remain above 2021 lows given structurally higher rates. Boardwalk REIT’s reported fair market cap rate serves as a useful benchmark, providing an ancillary check on market yield expectations for multifamily assets.
In this section, a capitalization rate for the subject is developed based upon the comparable properties in the following table.
The comparable capitalization rates indicate a range from 5.92% to 6.24% with an average of 6.03%.
Capitalization Rate Analysis – Multifamily
Comparable sales were analyzed from both North Battleford and Martensville to reflect investor activity in tertiary Saskatchewan markets. The comparable properties indicate capitalization rates ranging from 5.92% to 6.24%, with the majority clustering near the 5.99% range.
The newer properties in Martensville (Parkside Flats 1 and 2) exhibit lower cap rates of 5.92%, consistent with higher-quality construction, modern finishes, and superior appeal. In contrast, the older assets located in North Battleford, such as Heritage House and College View Apartments, achieved cap rates closer to 5.99%–6.24%, reflecting higher risk premiums associated with tertiary markets, older improvements, and smaller population bases.
Given the subject’s age (circa 1970), average quality, and its location within North Battleford, a smaller, tertiary market with limited liquidity, an upward adjustment toward the higher end of the observed range is appropriate. The subject’s stable occupancy and average condition support investor confidence, though risk perception remains elevated relative to newer urban comparables.
Based on the foregoing analysis, an appropriate capitalization rate for the subject property is concluded at approximately 6.25%, reflecting market expectations for well-maintained, stabilized multifamily assets within tertiary Saskatchewan markets.
Capitalization Rate Conclusion
Based on these indicators and the subject’s characteristics, average location, vintage, and limited amenity offering, a cap rate at the higher end of the range is considered appropriate for valuing the subject on an as stabilized basis. This aligns with recent market activity for similar assets in comparable locations.
Direct Capitalization Conclusion
The table below summarizes the Direct Capitalization Method and its value conclusion.
Given that the subject is a multitenant asset with short term it is generally understood that the direct capitalization method is preferred, making the discounted cash flow (DCF) method less meaningful. For this reason, we have completed only the direct capitalization method.
Direct Comparison Approach: Multifamily
Introduction
In the Sales Comparison Approach, the value of a property is estimated by comparing it with similar, recently sold properties in the surrounding or competing areas. Inherent in this approach is the principle of substitution, which holds that when a property is replaceable in the market, its value tends to be set by the cost of buying an equally desirable property, assuming that no costly delay occurs in making the substitution.
Comparable Selection
Through the analysis of sales of verified arm’s-length transactions, market value and price trends are identified. The sales utilized are comparable to the subject in physical, functional, and economic characteristics.
Comparable sales are presented, which were selected due to their similarity in physical, locational, and qualitative attributes. They represent the most recent and relevant comparable sale available for this analysis. Emphasis was given to the subject’s location and similarly positioned properties.
Unit of Comparison
The most relevant unit of comparison is the price per Unit. This best reflects the unit of comparison used by buyers and sellers in this market for the subject property type.
Adjustments
Adjustments to the comparable sales were considered and made when warranted for property rights, financing terms, conditions of sale, expenditures after sale and market conditions.
Quantitative Adjustment Process
In this method, we have compared the sales to the subject primarily along economic lines rather than on physical characteristics. Economic measures such as the relationship of sales price to net operating income are inclusive of all the physical and economic attributes of a property. It should be stressed that the adjustments are subjective in nature and are meant to illustrate the logic in deriving a value opinion for the subject property by the Sales Comparison Approach.
Presentation
The subject and comparable property attributes are presented on the following Improved Sales Comparison Table, location map and photographs. This is followed by analysis of the subject and comparable sales and the value conclusion indicated using the Sales Comparison Approach.
Sales Summary Sheets
Heritage House Comparable 1
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College View Apartments Comparable 2
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Woodland Estates Comparable 3
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Parkside Flats 1 Comparable 4
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Parkside Flats 2 Comparable 5
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The comparable sales indicate an overall unadjusted unit value range from $85,627/Unit to $214,375/Unit, and an average of $145,999/Unit. After adjustments, the comparables indicate a narrower range for the subject property from $111,914/Unit to $118,100/Unit, and $115,981/Unit on average. The adjustment process is summarized below.
Sales Comparison Approach Analysis
In our opinion, a buyer’s criteria for the purchase of properties such as the subject are predicated primarily on the property’s net income characteristics. Thus, we have identified a relationship between the net operating income and the sales price of the subject and the comparables. The income analysis accounts for differences between the comparables and the subject relative to differences in location, construction quality, age/condition, exposure, access and other physical characteristics. Inferior properties generally achieve lower rent levels resulting in a lower net operating income per square foot.
In this method, we have compared the sales to the subject primarily along economic lines rather than on physical characteristics. Economic measures such as the relationship of sales price to net operating income are inclusive of all the physical and economic attributes of a property.
Based on the preceding, we have trended the subject properties projected NOI per square foot and unit against the comparable properties NOI per square foot and unit and sale price per square foot and unit to estimate a value per unit for the subject property.
Based on general bracketing, the comparable sales support an adjusted unit value ranges from $111,914/Unit to $118,100/Unit, with a unit value of $112,500/Unit concluded for the subject property. The following table summarizes the analysis of the comparables, reports the reconciled price per Unit value conclusion, and presents the concluded value of the subject property by the Sales Comparison Approach.
Sales Comparison Approach Conclusion
Based on the agreed upon scope with the authorized client, the subject’s specific characteristics and the interest appraised, this appraisal developed Direct Comparison and Income (Direct Capitalization) Approaches. The values presented represent the As Stabilized (Fee Simple Estate).
The Reconciliation of Value Conclusions is the final step in the appraisal process and involves the weighing of the individual valuation techniques in relationship to their substantiation by market data, and the reliability and applicability of each valuation technique to the subject property. Below, the individual strengths and weaknesses of each approach are analyzed.
As previously discussed, the Cost Approach was not presented in this analysis. This approach has limited application due to the age of the improvements and lack of market-based evidence to support accrued depreciation. Additionally, investors typically do not place emphasis on replacement cost in establishing value for investment properties. The exclusion of the Cost Approach does not diminish the credibility of the value conclusion.
The price per unit method has been presented in the Sales Comparison Approach. There have been several recent sales of properties similar to the subject in the market area in the current market conditions, which increases the validity of this approach. The most likely buyer for the subject would be an investor and this approach is given less weight.
The Income Approach to value is generally considered to be the best and most accurate measure of the value of income-producing properties. The value estimate by this approach best reflects the analysis that knowledgeable buyers and sellers carry out in their decision-making processes regarding this type of property. Sufficient market data was available to reliably estimate gross income, vacancy, expenses and capitalization rates for the subject property. The subject is fully leased to multiple tenants as of the effective date of valuation. The most likely buyer is an investor, suggesting this approach deserves primary emphasis.
After considering all factors relevant to the valuation of the subject property, sole emphasis is placed on the Income (Direct Capitalization) Approach in the following market value.
The use of a hypothetical condition(s) may have impacted the results of the assignment. The As Stabilized value has been developed based on the hypothetical condition that the subject property is fully leased at prevailing market rents and has achieved stabilized occupancy as of the effective date of the appraisal. Under this premise, no deductions are made for holding costs, rent loss, or lease-up expenses. In addition it is a hypothetical condition that all units could achieve current market rent levels and stabilized occupancy as of the effective date. In reality, as of the effective date, the property's existing lease terms reflect contract rents that are deemed to be below-market rents. For the purposes of this analysis, it is assumed that lease-up to market rent levels has occurred under typical market conditions, without undue delay or concessions exceeding market norms. If this assumption proves incorrect, such as market rents are not achievable the value conclusion may be materially impacted.
Extraordinary Assumptions
No Extraordinary Assumptions were made for this assignment.
Extraordinary Limiting Conditions
No Extraordinary Limiting Conditions were made for this assignment.
We certify that, to the best of our knowledge and belief:
Based upon the data, analyses and conclusions contained herein, the market value of the fee simple estate in the subject property is concluded as follows:
Hypothetical Conditions
The use of a hypothetical condition(s) may have impacted the results of the assignment. The As Stabilized value has been developed based on the hypothetical condition that the subject property is fully leased at prevailing market rents and has achieved stabilized occupancy as of the effective date of the appraisal. Under this premise, no deductions are made for holding costs, rent loss, or lease-up expenses. In addition it is a hypothetical condition that all units could achieve current market rent levels and stabilized occupancy as of the effective date. In reality, as of the effective date, the property's existing lease terms reflect contract rents that are deemed to be below-market rents. For the purposes of this analysis, it is assumed that lease-up to market rent levels has occurred under typical market conditions, without undue delay or concessions exceeding market norms. If this assumption proves incorrect, such as market rents are not achievable the value conclusion may be materially impacted.
Extraordinary Assumptions
No Extraordinary Assumptions were made for this assignment.
Extraordinary Limiting Conditions
No Extraordinary Limiting Conditions were made for this assignment.
Chris Chornohos, AACI, MRICS Founder chris.chornohos@valta.ca |
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AIC No: 90209 |
Contingent & Limiting Conditions
Assumptions, Limiting Conditions, Disclaimers and Limitations of Liability
The certification that appears in the appraisal report is subject to compliance with the Canadian Uniform Standards of Professional Appraisal Practice (“CUSPAP”) and the following conditions:
Qualifications of the Appraiser
Valta Property Valuations Ltd.
300, 4838 Richard Road SW
Calgary, AB T3E 6L1
Office: 587-801-5151